(Reuters) - Nigerian President Goodluck Jonathan met with engineering firms, utilities companies and financiers from around the world on Thursday to try to woo investment in the planned multi-billion dollar privatisation of the power sector.
Following are some details on why the programme is important, and what the plans involve.
THE PROBLEM
Africa's most populous nation of more than 140 million is the continent's biggest oil and gas producer, yet is blighted by persistent electricity outages which force businesses and individuals who can afford them to rely on diesel generators.
Generation sometimes plunges below 1,000 megawatts (MW), largely due to a lack of maintenance at power stations, around a tenth of the country's basic needs. South Africa, with a third of Nigeria's population, has ten times the capacity.
Power shortages are a major brake on growth in sub-Saharan Africa's second-biggest economy, pushing up the cost of business for manufacturers and making Nigeria uncompetitive as an investment destination for industry despite a population which makes it one of the world's largest untapped frontier markets.
It also perpetuates social inequality in a country where most of the population survive on $2 a day or less, depriving many of light at night or the ability to power water pumps, let alone recharge mobile phones or access the Internet.
The central bank says 60 million people rely on generators and spend $13 billion a year fuelling them.
THE SOLUTION
President Jonathan has announced plans for a $3.5 billion national electricity grid to be jointly financed with the private sector and development agencies.
The presidency has said the new "supergrid" will be completed within four years and boost Nigeria's generating capacity to over 14,000 megawatts (MW) by the end of 2013.
His administration has promised to privatise electricity generation and distribution next year.
The central bank has said it is ready to release $2 billion from a fund earmarked to stimulate credit to the real economy, much of it meant for power sector projects.
FACTBOX-Nigeria's reform plans for domestic power sector
| Reuters
(http://www.reuters.com/article/idUSLDE69D0Q620101014)